EPRA is expected to announce the August-September fuel prices next week. Oil tankers at the Port of Mombasa’s Kipevu Oil Terminal /KPA Motorists, businesses and households stare at another round of fuel price increases next week as continued Middle East tensions offer no respite on global crude oil prices.
The war also continues to disrupt key shipping routes, threatening to fuel inflation that is already started edging higher, with oil sector experts cautioning that last month’s escalations could be felt in the next pricing cycle. The Energy and Petroleum Regulatory Authority (EPRA) is expected to announce the August-September fuel prices next week.
With Kenya's fuel prices determined using a one-month import pricing cycle, based on the weighted average import costs of cargoes, the renewed surge in global oil prices during July is expected to feed into the next review. The latest geopolitical tensions involving the United States and Iran, continued attacks by Yemen's Houthi rebels on commercial vessels in the Red Sea, and the prolonged Russia-Ukraine war have rattled global energy markets, increasing both crude oil prices and shipping costs.
Brent crude has climbed back above 80 dollars a barrel after the Houthis claimed responsibility for a missile attack on a Saudi oil tanker near Yanbu, a key export terminal for Saudi crude. The benchmark reached a high of 100.69 dollars per barrel on July 23 amid fears of supply disruptions and threats to shipping through the Strait of Hormuz.
For Kenya, which imports all its refined petroleum products, the developments pose significant risks to fuel costs and the broader economy. Petroleum Outlets Association of Kenya (POAK) chairman Martin Chomba yesterday warned that although the government's fuel import arrangement may cushion consumers in the short term, sustained increases in international prices will inevitably find their way to local pumps.
"The first and most immediate impact is likely to be felt at the fuel pump," Chomba said.